[36 Pa.B. 6289]
[Saturday, October 14, 2006]
[Continued from previous Web Page]
Annex A
TITLE 52. PUBLIC UTILITIES
PART I. PUBLIC UTILITY COMMISSION
Subpart C. FIXED SERVICE UTILITIES
CHAPTER 75. ALTERNATIVE ENERGY PORTFOLIO STANDARDS
Subchapter D. ALTERNATIVE ENERGY PORTFOLIO REQUIREMENT (Editor's Note: The following subchapter is new and is printed in regular type to enhance readability.)
Sec.
75.51. EDC and EGS obligations. 75.52. Fuel and technology standards for alternative energy sources. 75.53. Alternative energy system qualification. 75.54. Alternative energy credit certification. 75.55. Alternative energy credit program administrator. 75.56. Alternative compliance payments. 75.57. General force majeure. 75.58. Special force majeure. 75.59. Alternative energy cost-recovery. 75.60. Alternative energy market integrity. 75.61. Banking of alternative energy credits. 75.62. Alternative energy credit registry. § 75.51. EDC and EGS obligations.
(a) EDCs and EGSs shall comply with the act through the acquisition of certified alternative energy credits, each of which shall represent one MWh of qualified alternative electric generation or conservation, whether self-generated, purchased along with the electric commodity or separately through a tradable instrument.
(b) For each reporting period, EDCs and EGSs shall acquire alternative energy credits in quantities equal to a percentage of their total retail sales of electricity to all retail electric customers for that reporting period, as measured in MWh. The required quantities of alternative energy credits for each reporting period is identified in the following schedule:
(1) For June 1, 2006, through May 31, 2007: The Tier I requirement is 1.5% of all retail sales, the solar photovoltaic requirement is .0013% of Tier I sales, and the Tier II requirement is 4.2% of all retail sales.
(2) For June 1, 2007, through May 31, 2008: The Tier I requirement is 1.5% of all retail sales, the solar photovoltaic requirement is .0013% of Tier I sales, and the Tier II requirement is 4.2% of all retail sales.
(3) For June 1, 2008, through May 31, 2009: The Tier I requirement is 2% of all retail sales, the solar photovoltaic requirement is .0013% of Tier I sales, and the Tier II requirement is 4.2% of all retail sales.
(4) For June 1, 2009, through May 31, 2010: The Tier I requirement is 2.5% of all retail sales, the solar photovoltaic requirement is .0013% of Tier I sales, and the Tier II requirement is 4.2% of all retail sales.
(5) For June 1, 2010, through May 31, 2011: The Tier I requirement is 3% of all retail sales, the solar photovoltaic requirement is .0203% of Tier I sales, and the Tier II requirement is 6.2% of all retail sales.
(6) For June 1, 2011, through May 31, 2012: The Tier I requirement is 3.5% of all retail sales, the solar photovoltaic requirement is .0203% of Tier I sales, and the Tier II requirement is 6.2% of all retail sales.
(7) For June 1, 2012, through May 31, 2013: The Tier I requirement is 4% of all retail sales, the solar photovoltaic requirement is .0203% of Tier I sales, and the Tier II requirement is 6.2% of all retail sales.
(8) For June 1, 2013, through May 31, 2014: The Tier I requirement is 4.5% of all retail sales, the solar photovoltaic requirement is .0203% of Tier I sales, and the Tier II requirement is 6.2% of all retail sales.
(9) For June 1, 2014, through May 31, 2015: The Tier I requirement is 5% of all retail sales, the solar photovoltaic requirement is .0203% of Tier I sales, and the Tier II requirement is 6.2% of all retail sales.
(10) For June 1, 2015, through May 31, 2016: The Tier I requirement is 5.5% of all retail sales, the solar photovoltaic requirement is .25% of Tier I sales, and the Tier II requirement is 8.2% of all retail sales.
(11) For June 1, 2016, through May 31, 2017: The Tier I requirement is 6% of all retail sales, the solar photovoltaic requirement is .25% of Tier I sales, and the Tier II requirement is 8.2% of all retail sales.
(12) For June 1, 2017, through May 31, 2018: The Tier I requirement is 6.5% of all retail sales, the solar photovoltaic requirement is .25% of Tier I sales, and the Tier II requirement is 8.2% of all retail sales.
(13) For June 1, 2018, through May 31, 2019: The Tier I requirement is 7% of all retail sales, the solar photovoltaic requirement is .25% of Tier I sales, and the Tier II requirement is 8.2% of all retail sales.
(14) For June 1, 2019, through May 31, 2020: The Tier I requirement is 7.5% of all retail sales, the solar photovoltaic requirement is .25% of Tier I sales, and the Tier II requirement is 8.2% of all retail sales.
(15) For June 1, 2020, through May 31, 2021, and each successive twelve month period thereafter: The Tier I requirement is 8% of all retail sales, the solar photovoltaic requirement is .5% of Tier I sales, and the Tier II requirement is 10% of all retail sales.
(c) EDCs are exempt from these requirements for the duration of their cost-recovery period. An EDC shall be required to comply with the requirements in effect during the reporting period, as identified in subsection (b), in which its exemption expires.
(d) EGSs are exempt from these requirements in the service territories of EDCs in their cost-recovery period. EGS compliance shall be measured against their total MWh sales to all retail electric customers in all EDC service territories that have exited their cost-recovery periods.
(e) A 90 day true-up period shall commence at the end of each reporting period. EDCs and EGSs not in compliance with this chapter at the end of a reporting period, as determined by the program administrator under § 75.55(c)(2) (relating to alternative energy credit program administrator), may acquire additional alternative energy credits during the true-up period to satisfy the requirements of this chapter.
(f) EDCs shall provide monthly reports to the program administrator documenting total deliveries of electricity to all retail electric customers within their service territory. Separate totals shall be reported for each load serving entity active in the EDC's service territory. Reports shall be submitted to the program administrator within 45 days from the end of each month.
§ 75.52. Fuel and technology standards for alternative energy sources.
(a) Alternative energy system status may be granted to existing or new facilities, except where provided otherwise, including those interconnected and net-metered by customer generators, that generate electricity through the following Tier I alternative energy fuel sources and technologies:
(1) Solar photovoltaic. Electricity generated from solar photovoltaic technologies that utilize solar energy
(2) Solar thermal. Electricity generated from solar thermal technologies that utilize solar energy.
(3) Wind. Electricity generated through use of windmills, wind turbines, or other technologies that utilize wind energy.
(4) Low-impact hydropower. Electricity generated from any technology that produces electric power by harnessing the hydroelectric potential of moving water impoundments, provided that the facility:
(i) Was permitted on or after February 28, 2005, or represents capacity additions or efficiency improvements to a preexisting facility implemented on or after February 28, 2005.
(ii) Does not adversely change existing impacts to aquatic systems.
(iii) Meets the certification standards established by the Low Impact Hydropower Institute and American Rivers, Inc., or their successors.
(iv) Provides an adequate water flow for protection of aquatic life and for safe and effective fish passage.
(v) Protects against erosion.
(vi) Protects cultural and historic resources.
(5) Geothermal energy. Electricity produced by extracting hot water or steam from geothermal reserves in the earth's crust and supplied to steam turbines that drive generators to produce electricity.
(6) Biomass energy. Electricity generated utilizing the following:
(i) Organic material from a plant that is grown for the purpose of being used to produce electricity or is protected by the Federal Conservation Reserve Program (CRP) and provided further that production on CRP lands does not prevent achievement of the water quality protection, soil erosion prevention or wildlife enhancement purposes for which the land was primarily set aside. This may include switchgrass and other warm seasonal grasses, hybrid willow and hybrid poplar.
(ii) Solid, nonhazardous, cellulosic waste material segregated from other waste materials, such as waste pallets, crates, landscape or right-of-way tree trimmings or agricultural sources, including orchard tree crops, vineyards, grain, legumes, sugar and other crop by-products or residues. This includes bark, sawdust and clean, untreated wood chips from lumber mills, manufacturers or other producers that otherwise meet the definition of solid, nonhazardous, cellulosic waste material segregated from other waste materials.
(7) Biologically derived methane gas. Electricity produced from methane from the anaerobic digestion of organic materials from yard waste, such as grass clippings and leaves, food waste, animal waste and sewage sludge. This source also includes landfill methane gas.
(8) Coal mine methane. Electricity produced from methane gas emitting from abandoned or working coal mines, specifically fugitive methane released from its natural geologic sequestration as a result of coal-mining activity and vented to the atmosphere, or destroyed without useful energy recovery. This source does not include commercially developed coal bed methane.
(9) Fuel cells. Electricity produced from an electrochemical device that converts chemical energy in a hydrogen-rich fuel directly into electricity, heat and water without combustion.
(b) Alternative energy system status may be granted to existing or new facilities, except where provided otherwise, that generate or conserve electricity through the following Tier II alternative energy fuel sources and technologies:
(1) Large scale hydropower. Electricity produced by harnessing the hydroelectric potential of moving water impoundments, including pumped storage that does not meet the requirements of low-impact hydropower.
(2) Waste coal. Electricity generated from the combustion of waste coal in facilities when the waste coal was disposed of or abandoned prior to July 31, 1982, or disposed of thereafter in a permitted coal refuse disposal site regardless of when disposed of. Facilities combusting waste coal shall use, at a minimum, a combined fluidized bed boiler and be outfitted with a limestone injection system and a fabric filter particulate removal system. Alternative energy credits shall be calculated based upon the proportion of waste coal utilized to produce electricity at the facility. Applicants may petition for waste coal from nonpermitted sites to be qualified for alternative energy resource status. The Commission may grant the petitions at its discretion.
(3) Demand-side management. The conservation of electricity through:
(i) Energy efficiency technologies, management practices or other strategies in residential, commercial, industrial, institutional or government customers that reduce electricity consumption by those customers.
(ii) Load management or demand response technologies, management practices or other strategies in residential, commercial, industrial, institutional and government customers that shift electric load from periods of higher demand to periods of lower demand.
(iii) Industrial by-product technologies consisting of the use of a by-product from an industrial process, including the reuse of energy from exhaust gases or other manufacturing by-products, used in the direct production of electricity at the facility of a customer.
(4) Distributed generation system. Small-scale power generation of electricity and useful thermal energy.
(5) Integrated combined coal gasification technology (ICCG). Electricity generated from combined cycle format with a gas turbine driven by the combusted syngas, while exhaust gases are heat exchanged with water/steam to generate superheated steam to drive a steam turbine. Alternative energy credits shall only be certified for electricity produced by ICCG technology. The use of ICCG to create feedstocks for manufacturing or liquid fuels not used to generate electricity may not be eligible for the certification of alternative energy credits.
(6) Municipal solid waste. Electricity generated from waste to energy facilities permitted by the Department on or before February 28, 2005, which the Department has determined to be in compliance with current environmental standards, including applicable requirements of the Clean Air Act (42 U.S.C.A. §§ 7401--7618) and associated permit restrictions and applicable requirements of Solid Waste Management Act (35 P. S. §§ 6018.101--6018.1003).
(7) Wood pulping and manufacturing. Electricity generated by utilizing by-products of the pulping process and wood manufacturing process, including bark, wood chips, sawdust and lignin in spent pulping liquors.
§ 75.53. Alternative energy system qualification.
(a) An application for alternative energy system status shall be submitted on a form developed and made available by the Commission. A copy of the application form will be made available on the Commission's public internet domain. An application shall be verified by oath or affirmation as required in § 1.36 (relating to verification).
(b) A completed application and supporting attachments shall be filed with the alternative energy credit program administrator, and any other parties that may be designated by the Commission.
(c) A facility shall be qualified for alternative energy system status if it is physically located in either:
(1) This Commonwealth.
(2) The control area of an RTO that manages a portion of the electric transmission system in this Commonwealth.
(d) The alternative energy credits associated with a qualified alternative system located outside of this Commonwealth shall be eligible for compliance purposes only in the portions of this Commonwealth within the boundaries of the same RTO control area as that alternative energy system.
(e) A facility shall be qualified for alternative energy system status if it generates electricity from or conserves electricity through a Tier I or Tier II alternative energy source identified in § 75.52 (relating to fuel and technology standards for alternative energy sources).
(f) A facility shall be qualified if the Department has verified compliance with applicable environmental regulations, and if it has obtained necessary State and Federal environmental permits for operations.
(g) Alternative energy system applicants shall provide the Department with all information necessary to verify compliance with applicable environmental regulations and § 75.52.
(h) The Commission may suspend or revoke the alternative energy system status of a facility, after notice and opportunity to be heard, for major violations of environmental regulations, or failure to satisfy the requirements of an alternative energy source in § 75.52. Major environmental violations shall be defined as those that cause significant harm to the environment or public health and result in a compliance order or penalty assessed by the Department. Alternative energy credits may not be certified for that facility for a period beginning with the suspension or revocation of alternative energy system status, as evidenced by formal Commission action, through the time that alternative energy system status is restored.
§ 75.54. Alternative energy credit certification.
(a) An alternative energy credit may be certified by the Commission for each MWh of electricity generated by qualified alternative energy systems on or after February 28, 2005.
(b) An alternative energy credit may be certified by the Commission for each MWh of electricity conserved by qualified alternative energy systems on or after November 30, 2004.
(c) An alternative energy credit may not be certified for a MWh of electricity generation or electricity conservation that has already been used to satisfy another state's renewable energy portfolio standard, alternative energy portfolio standard, or other comparable standard.
(d) An alternative energy credit shall be certified for that portion of a qualified alternative energy system's electric generation that is consumed within or delivered to the distribution system of an EDC in this Commonwealth or the control area of an RTO that manages a portion of this Commonwealth's transmission system.
(e) When an alternative energy system relies on more than one fuel source or technology, alternative energy credits shall be certified for that portion of the electric generation that is derived from an alternative energy fuel source or technology as identified in § 75.52.
(f) Alternative energy credit certification shall be verified by metered data under standards approved by the Commission.
(g) An alternative energy credit represents the attributes of 1 MWh of electric generation that may be used to satisfy the requirements of § 75.51 (relating to EDC and EGS obligations). A certified alternative energy credit does not automatically include environmental, emissions or other attributes associated with 1 MWh of electric generation. Parties may bundle the attributes unrelated to compliance with § 75.51 with an alternative energy credit, or, alternatively, sell, assign, or trade them separately.
§ 75.55. Alternative energy credit program administrator.
(a) The Commission may select an independent entity to act as a program administrator and perform administrative functions necessary to the implementation of this chapter. If an independent entity is not selected to act as a program administrator, the Commission will perform the functions identified in this section.
(b) The program administrator will have the following powers and duties in regard to alternative energy system qualification:
(1) Distribute, receive, and review applications for alternative energy system qualification.
(2) Reject applications that are incomplete or do not adhere to the application instructions.
(3) Determine whether an application satisfies the geographic eligibility standard in § 75.53(c) (relating to alternative energy system qualification) and reject applications that fail this standard.
(4) Refer verification of the application's compliance with applicable environmental regulations to the Department.
(5) Refer verification of the application's compliance with § 75.52 (relating to fuel and technology standards for alternative energy sources) to the Department.
(6) Reject applications that the Department advises to be noncompliant with environmental regulations or § 75.52.
(7) Qualify applicants for alternative energy system status who have filed a complete application, adhered to application instructions, satisfied the geographic eligibility standard, complied with environmental regulations, and utilized an alternative energy fuel source or technology consistent with § 75.52.
(8) The program administrator will provide written notice to applicants of its qualification decision within 30 days of receipt of a complete application form.
(c) The program administrator shall have the following powers and duties regarding the verification of compliance with this chapter:
(1) At the end of each reporting period, the program administrator shall verify EDC and EGS compliance with § 75.51 (relating to EDC and EGS obligations), and provide written notice to each EDC and EGS of their compliance status within 45 days of the end of the reporting period.
(2) At the end of each true-up period, the administrator shall verify compliance with § 75.51 for EDCs and EGSs who were in violation of § 75.51 at the end of the reporting period. The administrator will provide written notice to each EDC and EGS of their compliance status within 15 days of the end of the true-up period.
(3) EDCs and EGSs shall provide all information to the program administrator necessary to verify compliance with § 75.51.
(4) The program administrator shall provide a report to the Commission within 45 days of the end of each reporting period and true-up period that identifies the compliance status of all EDCs and EGSs. The report provided after the end of the true-up period shall propose alternative compliance payment amounts for each EDC and EGS that is noncompliant with § 75.51 for that reporting period. As part of this report the administrator shall identify the average market value of alternative energy credits derived from solar photovoltaic energy sold in the reporting period for each RTO that manages a portion of this Commonwealth's transmission system.
(d) The program administrator shall have the following powers and duties relating to alternative energy credit certification:
(1) The program administrator shall certify alternative energy credits for the portion of a qualified alternative energy system's electric generation that is consumed within or delivered to the distribution system of an EDC in this Commonwealth or the control area of an RTO that manages a portion of this Commonwealth's transmission system.
(2) The program administrator may not certify alternative energy credit for a MWh of electricity generation or electricity conservation that has already been used to satisfy another state's renewable energy portfolio standard, alternative energy portfolio standard, or other comparable standard.
(e) A decision of the program administrator may be appealed consistent with § 5.44 (relating to petitions for appeal from actions of staff).
(f) The Commission may delegate other responsibilities to the program administrator as may be necessary for the implementation of the act.
§ 75.56. Alternative compliance payments.
(a) Within 15 days of receipt of the report identified in § 75.55(c)(4) (relating to alternative energy credit program administrator), the Commission will provide written notice to each EDC and EGS that was noncompliant with § 75.51 (relating to EDC and EGS obligations) of their alternative compliance payment for that reporting period.
(b) Each EDC and EGS shall be assessed an alternative compliance payment according to the following formula:
(1) For noncompliance with the solar photovoltaic requirements identified in § 75.51, an EDC and EGS shall make an alternative compliance payment equal to the number of additional alternative credits necessary for compliance times 200% the average market value for solar photovoltaic alternative energy credits sold during the reporting period in the RTO control area where the noncompliance occurred.
(2) For noncompliance with other requirements identified in § 75.51, an EDC and EGS shall make an alternative compliance payment equal to $45 times the number of additional alternative energy credits necessary for compliance in that reporting period.
(3) The costs of alternative compliance payments made under this section may not be recoverable from ratepayers.
(c) EDCs and EGSs shall advise the Commission in writing within 15 days of the issuance of this notice of their acceptance of the alternative compliance payment determination or, if they wish to contest the determination, file a petition to modify the level of the alternative compliance payment. The petition shall include documentation supporting the proposed modification. The Commission will refer the petition to the Office of Administrative Law Judge for further proceedings as may be necessary. Failure of an EDC or EGS to respond to the Commission within 15 days of the issuance of this notice shall be deemed an acceptance of the alternative compliance payment determination.
(d) EDCs and EGSs shall send their alternative compliance payments to a special fund designated by the Commission within 30 days of acceptance of their payment determination, or the conclusion of proceedings before the Commission regarding the modification of the level of payment.
(e) Alternative compliance payments shall be made available to the sustainable energy funds established through the Commission's orders entered under 66 Pa.C.S. § 2806(f) (relating to Commission review of restructuring filings), under procedures and standards proposed by the Pennsylvania Sustainable Energy Board and approved by the Commission.
(f) Alternative compliance payments made available to the sustainable energy funds shall be utilized solely for projects that increase the amount of electric energy generated from alternative energy resources for purposes of compliance with § 75.51.
(g) The Commission may utilize up to 5% of alternative compliance payments made by EDCs and EGSs for administrative expenses directly associated with the implementation of this chapter, including the costs of the program administrator.
§ 75.57. General force majeure.
(a) At least 30 days prior to the beginning of a reporting period, the Commission will issue an order declaring whether force majeure exists for that reporting period. The order will include separate force majeure determinations for the Tier I alternative energy source, Tier II alternative energy source, and solar photovoltaic requirements of § 75.51 (relating to EDC and EGS obligations).
(b) The Commission may find that force majeure exists if there are insufficient alternative energy credits to satisfy the aggregate Tier I alternative energy source, Tier II alternative energy source, and solar photovoltaic obligation for all EDCs and EGSs under § 75.51 for that reporting period.
(c) The Commission may find that force majeure exists for the nonsolar photovoltaic requirement of § 75.51 if the average price for a nonsolar photovoltaic alternative energy credit purchased by an EDC and EGS in this Commonwealth exceeds $45 in the 6 month period ending 30 days prior to the issuance of the order referenced in subsection (a).
(d) If the Commission determines that force majeure exists for a reporting period for, EDCs and EGSs shall have the option of making alternative compliance payments in lieu of compliance with § 75.51 for that reporting period.
(1) This payment shall equal $ 45 for each alternative energy credit needed to satisfy the Tier I and Tier II requirements of § 75.51.
(2) For the solar photovoltaic requirement, EDCs and EGSs shall have the option of making an alternative compliance payment equal to the market value of solar photovoltaic credits in the applicable RTO service territory, or the Commission may choose to reduce the required level of solar photovoltaic compliance for that reporting period.
(3) A payment shall be accompanied by a statement filed with the Commission and verified by oath of affirmation, consistent with § 1.36 (relating to verification), that the EDC or EGS has made a good faith effort to comply with the requirements of this chapter, that they are unable to acquire a sufficient quantity of alternative energy credits to meet their obligations under § 75.51, and that an alternative compliance payment is the least cost method of compliance.
(4) The option to make an alternative compliance payment in lieu of compliance with § 75.51 may not be available to EDCs and EGSs that have already acquired sufficient alternative energy credits for compliance with the requirements of that reporting period.
(e) Alternative compliance payments made by EDCs under subsection (d) shall be deemed a cost of compliance with this chapter and may be recovered under § 75.59 (relating to alternative energy cost-recovery).
(f) EDCs and EGSs shall provide the Commission information necessary for it to render a force majeure determination.
§ 75.58. Special force majeure.
(a) Within 45 days of the conclusion of a reporting period for which the Commission did not find force majeure to exist for the Tier I alternative energy source, Tier II alternative energy source, and solar photovoltaic requirements of § 75.51 (relating to EDC and EGS obligations), an EDC or EGS not in compliance with § 75.51 may petition the Commission for a force majeure determination.
(b) The Commission will provide public notice of all requests for a force majeure determination during the true-up period.
(c) The Commission may find that force majeure exists when there are insufficient alternative energy credits to satisfy the Tier I alternative energy source, Tier II alternative energy source, and solar photovoltaic obligations for all EDCs and EGSs requesting force majeure determinations under this section.
(d) The Commission may find that force majeure exists for the nonsolar photovoltaic requirement of § 75.51 when the average price for a nonsolar photovoltaic alternative energy credit purchased by an EDC and EGS in this Commonwealth exceeds $45 for the just concluded reporting period in § 75.57(a) (relating to general force majeure).
(e) If the Commission determines that force majeure exists for the true-up period, an EDC or EGS requesting a force majeure determination shall have the option of making alternative compliance payments in lieu of compliance with § 75.51 for the just concluded reporting period, consistent with the standard identified in § 75.57. Payments shall be accompanied by a statement filed with the Commission and verified by oath of affirmation, consistent with § 1.36 (relating to verification), that the following apply:
(i) The EDC or EGS has made a good faith effort to comply with this chapter.
(ii) The EDC or EGS is unable to acquire a sufficient quantity of alternative energy credits to meet their obligations under § 75.51.
(iii) An alternative compliance payment is the least cost method of compliance.
(f) Alternative compliance payments made by EDCs under subsection (e) shall be deemed a cost of compliance with this chapter and may be recovered under § 75.59 (relating to alternative energy cost-recovery).
(g) EDCs and EGSs shall provide the Commission all information necessary for it to render a special force majeure determination.
§ 75.59. Alternative energy cost-recovery.
(a) A default service provider may recover from default service customers the following reasonable and prudently incurred costs for compliance with the act:
(1) The costs of electricity generated by an alternative energy system, purchased by a default service provider, and delivered to default service customers for purposes of compliance with § 75.51 (relating to EDC and EGS obligations).
(2) The costs of alternative energy credits purchased and used within the same reporting period for purposes of compliance with § 75.51.
(3) The costs of alternative energy credits purchased in one reporting period and banked for use in later reporting periods, consistent with § 75.61 (relating to banking of alternative energy credits).
(4) The costs of alternative energy credits purchased in the true-up period to satisfy compliance obligations for the most recently concluded reporting period, consistent with § 75.51(e).
(5) Payments to the alternative energy credits program administrator for its costs of administering an alternative energy credits program, consistent with § 75.55 (relating to alternative energy credit program administrator).
(6) Payments to a third party for its costs in operating an alternative energy credits registry, consistent with § 75.62 (relating to alternative energy credit registry).
(7) The costs levied by a regional transmission organization to ensure that alternative energy sources are reliable.
(8) The costs of alternative compliance payments made under §§ 75.57 and 75.58 (relating to general force majeure; and special force majeure).
(b) A default service provider shall demonstrate compliance with the requirements of § 75.51 and the default service provisions of Chapter 54 (relating to electricity generation customer choice) by identifying a competitive procurement process for acquiring alternative energy credits in default service implementation plans filed with the Commission.
(c) A competitive procurement process for alternative energy and alternative energy credits must comply with the standards for competitive procurement processes identified in the default service provisions in Chapter 54.
(d) The costs of compliance with the alternative energy portfolio standards act shall be recovered through an automatic adjustment clause within the meaning of 66 Pa.C.S. § 1307 (relating to sliding scale of rates; adjustments) according to the following standards:
(1) Costs incurred by a default service provider during the cost-recovery period shall be deferred as a regulatory asset and fully recovered with a return on the unamortized balance during the first full 12-month reporting period after the expiration of the cost-recovery period in the EDC service territory where it is acting as the default service provider.
(2) Costs incurred by a default service provider after the expiration of a cost-recovery period shall be recovered during the reporting period in which they are incurred, except as provided for in paragraph (7).
(3) The default service implementation plan shall include a schedule of rates for the recovery of these costs as required under 66 Pa.C.S. § 1307(a).
(4) A default service provider shall file a report with the Commission within 30 days of the conclusion of each reporting period that includes the information identified in 66 Pa.C.S. § 1307(e)(1).
(5) The Commission will hold public hearings on the substance of these reports, and other matters pertaining to this subject, as required by 66 Pa.C.S. § 1307(e)(2).
(6) The Commission will order the default service provider to provide refunds to or recover additional costs from default service customers consistent with 66 Pa.C.S. § 1307(e)(3).
(7) The costs of alternative energy credits purchased by the default service provider during the true-up period under section 3(e)(5) of the act (73 P. S. § 1648.3(e)(5)) shall be recovered during the reporting period in which these costs are incurred.
(e) The Commission will perform fuel costs audits, on at least an annual basis, of each default service provider that recovers costs using the automatic adjustment clause provided for under this section.
§ 75.60. Alternative energy market integrity.
(a) Sales of electricity by EDCs and EGSs to retail electric customers marketed as deriving from alternative energy sources that exceed the requirements of § 75.51 (relating to EDC and EGS obligations) at the time of the sale shall be supported by alternative energy credits separate from and in addition to alternative energy credits counted for compliance with § 75.51.
(b) When EDCs and EGSs market their generation as deriving from alternative energy sources, they shall include information to substantiate their claims. Disclosure of alternative energy sources shall be traceable to specific alternative energy sources by an auditable contract trail or equivalent, such as a tradable commodity system, that provides verification that the alternative energy source claimed has been sold only once to a retail customer.
§ 75.61. Banking of alternative energy credits.
(a) An EDC and EGS may bank alternative energy credits certified in one reporting period for use in either or both of the two immediately following reporting periods.
(b) An EDC and EGS may bank alternative energy credits certified during a cost-recovery period for use in either:
(1) The reporting period in which the cost-recovery period expires, and the reporting period that immediately follows.
(2) The first two full, 12-month reporting periods for which compliance with § 75.51 (relating to EDC and EGS obligations) is required after the expiration of the cost-recovery period.
(c) Alternative energy credits acquired by EDCs and EGSs not used within the time limits identified in subsections (a) and (b) shall be retired within the alternative energy credits registry and not available for the compliance requirements of this chapter.
(d) EDCs and EGSs shall satisfy the requirements of this chapter for the present reporting period before banking alternative energy credits produced in that same reporting period for use in either or both of the two subsequent reporting periods.
(e) The Commission will determine the volume of sales, measured in MWh, by EDCs and EGSs to retail customers in the 12-month period that immediately preceded the effective date of the act derived from specific alternative energy systems. EDCs and EGSs may bank credits during the cost-recovery period for the generation output of qualified alternative energy systems that exceed their volume of alternative energy sales to retail customers during this 12-month period.
§ 75.62. Alternative energy credit registry.
(a) The Commission will designate an alternative energy credit registry to track the creation and transfer of certified alternative energy credits among qualified alternative energy systems, EDCs and EGSs. EDCs and EGSs shall record the price paid for each alternative energy credit in the alternative energy credit registry.
(b) The Commission may direct EDCs and EGSs to enter into agreements with an alternative energy credit registry to verify compliance with this chapter and for compliance with section 3(e)(8) of the act (73 P. S. § 1648.3(e)(8)). EDCs and EGSs shall comply with the rules, policies, and procedures of the designated alternative energy credit registry.
(c) EDCs and EGSs shall provide the Commission and the program administrator with access to information in this registry necessary to verify compliance with this chapter and for compliance with section 3(e)(8) of the act.
(d) The prices paid for individual credits will be treated as confidential information by the Commission. Aggregate pricing data on alternative energy credits will be made available to the public by the Commission or the program administrator on a regular basis.
[Pa.B. Doc. No. 06-2018. Filed for public inspection October 13, 2006, 9:00 a.m.]
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